A US city Stockton is bankrupt

[Snorrius]

http://latimesblogs.latimes.com/lan...ptcy-will-make-history-residents-reeling.html

Some US city Stockton is bankrupt. It seems to be relatively big - not that big but still ~300'000 of population.

So, what do you expect? Is it just unfortunate mistake in city's management or it is a sign of US economy's imminent crash and we should expect more?

 

[cegman]

We'll be seeing more of them. I'm not sure if this is an economy thing or just mismanagement by many cities but we will be seen more cities file for bankruptcy

 

[Snorrius]

What happens with such city?

 

[wilycoyote]

A city of 300k isn't large by American standards (it's the 65th largest city in the country).

This is the result of a recession hitting a terribly ran city. How is it that a city can spend way beyond its means and still be labeled a top 10 most dangerous city in the country? Is none of that wild spending spent on police?

This isn't a sign of things to come, rather a reminder of the recent past.

 

[Cheezy the Wiz]

It can't be that big. I've never head of it.

 

[Save_Ferris]

California's been going through a huge financial crisis for quite some time now. I'm not surprised, but I don't think there's a trend.

 

[JollyRoger]

What happens with such city?

The creditors get screwed.

 

[Snorrius]

It can't be that big. I've never head of it.

Well, Wikipedia says it is 291'707 and "Metro" whatever it means is 685'306.

 

[downtown]

I used to live in Stockton. It isn't a tiny city, it just sort of gets drowned out because California has so many bigger ones.

This isn't unremarkable (I think even NYC went bankrupt once, and it happens to US cities every once in a while during really bad recessions). Stocktown has been a city down in the dumps for decades, with high crime, poor schools and little investment.

Didn't Birmingham try to file for bankrupcy this year?

 

[Save_Ferris]

Stockton's actually bigger than Birmingham- not in the metropolitan area (which mean the city and surrounding suburbs, Snorrius), but it's just the city that's filing for bankruptcy. Although I do wonder how this will affect surrounding towns.

 

[sophie]

Stockton's been having serious money woes for some time now. This doesn't come as a surprise to most Californians.

 

[FriendlyFire]

The creditors get screwed.

Not if Republicans bring back slavery I mean personal responsiblity. Bailouts are only for people, by people I mean corporations.

 

[Kozmos]

What is with you and imminent crashes? I don't think it means what you think it means.

 

[Cutlass]

A city of 300k isn't large by American standards (it's the 65th largest city in the country).

This is the result of a recession hitting a terribly ran city. How is it that a city can spend way beyond its means and still be labeled a top 10 most dangerous city in the country? Is none of that wild spending spent on police?

This isn't a sign of things to come, rather a reminder of the recent past.

Essentially all of the wild spending has been on the police.

It isn't really that Stockton, and a lot of other places, spent wildly. Rather it is a question of them not really planning for what their future costs and revenues would be. It's easy to make promises you can't keep when a) good estimates of future costs and revenues have never been made and presented to the decision makers, and b) the bill is actually going to come due on someone else. For the elected officials making the decisions which results in this are usually long out of office before the promises can't be kept. And the voters never did have a clear picture of what the fiscal situation is going to be down the road. They were never told. All they were told was that "revenue then will be enough for costs then". But the problem with that is that the incomes of the residents ceased to grow. And so the tax revenues ceased to grow. And the deals for police pensions were never correctly accounted for in the first place. And so police pensions will drive many, many cities and some states into fiscal hell in the coming years.

 

[ParkCungHee]

My first though when I saw this: "When did John Stockton become a city?"

 

[civ_king]

Stockton's been having serious money woes for some time now. This doesn't come as a surprise to most Californians.

Yeah, the question was when not if.

 

[Formaldehyde]

Who doesn't know about Stockton and their world famous asparagus festival?

http://en.wikipedia.org/wiki/Stockton,_California

In the February 2, 2011 issue of Forbes, the magazine gave Stockton the dubious distinction of being the "most miserable" US city, largely as a result of the steep drop in home values.[14]

Central Connecticut State University surveys from 2005 and 2006 ranked the city as the least literate of all U.S. cities with a population of more than 250,000.[15][16][17]

According to a Gallup poll, Stockton was tied with Montgomery, Alabama for the most obese metro area in the United States of America with an obesity rate of 34.6 percent.[18]

 

[sophie]

Who doesn't know about Stockton and their world famous asparagus festival?

http://en.wikipedia.org/wiki/Stockton,_California

In the grand scheme of Bay Area/Central Coast vegetable festivals, it's smack in the middle. Not quite as good as the Gilroy Garlic Festival or Castroville Artichoke Festival, but it is a good one...

 

[Core Imposter]

Essentially all of the wild spending has been on the police.

It isn't really that Stockton, and a lot of other places, spent wildly. Rather it is a question of them not really planning for what their future costs and revenues would be. It's easy to make promises you can't keep when a) good estimates of future costs and revenues have never been made and presented to the decision makers, and b) the bill is actually going to come due on someone else. For the elected officials making the decisions which results in this are usually long out of office before the promises can't be kept. And the voters never did have a clear picture of what the fiscal situation is going to be down the road. They were never told. All they were told was that "revenue then will be enough for costs then". But the problem with that is that the incomes of the residents ceased to grow. And so the tax revenues ceased to grow. And the deals for police pensions were never correctly accounted for in the first place. And so police pensions will drive many, many cities and some states into fiscal hell in the coming years.

Very good post except that you left out the part where the politicians decided not to question whether their programs where feasible or not because they needed free ponies to pass out in exchanges for votes and other goodies.

Another bone to pick with it was that you shifted the blame from the politicians to those who "present to the decision makers", I just can't let them off the hook there. But otherwise, good work.

 

[Core Imposter]

http://latimesblogs.latimes.com/lan...ptcy-will-make-history-residents-reeling.html

Some US city Stockton is bankrupt. It seems to be relatively big - not that big but still ~300'000 of population.

So, what do you expect? Is it just unfortunate mistake in city's management or it is a sign of US economy's imminent crash and we should expect more?

Expect more. As for the timing, so long as central bankers are willing to conjure money out of thin air, and people are willing to deny the obvious, it will mirror the extend and pretend in the EU, till the day the music stops.

Debt rolls upward in liberal states.